The University of Georgia
College of Agricultural and Environmental Sciences
Niche Marketing
Kent Wolfe and Michael Besti
Niche market or niche marketing are words agricultural producers looking to enter new or value
added markets frequently encounter. What is a niche market? The word "niche" comes from a
French word that means to nest. Niche marketing is targeting a product or service to a small
portion of a market that is not being readily served by the mainstream product or service
marketers. Nearly every business in existence, including fast food chains, convenience stores,
and even super retailers like Wal-Mart began by filling perceived voids in the market place.
However, as these businesses grew, they no longer were operating in niche markets. A niche
market usually refers to small or moderate size businesses or farms that produce a specialty
product or service for a limited segment of the market, whether it is a geographic area, a
specialty industry, ethnic or age group, or any other particular group of people. Sometimes a
niche product can be a variation of a common product that is not produced and marketed by
larger marketing firms.
As can be seen from Table 1 on the following page, niche markets can be found across all
business segments. Sometimes a niche market is so narrow that the product is aimed at one small
group within a market. One example is producing blessed goat meat for the Muslim population
in Atlanta, GA. A goat processor would have to hire a mullah to observe the management and
slaughter activities at the processing facility so the products can be sold as Halal which is Arabic
word which means allowed or permissible. To make something Halal, in this case food, it must
be blessed. Muslim's ask the permission of Allah to slaughter one of His creatures.
In other situations, the market is somewhat more open, and competition can develop to provide
the product or service. For example, when the large, confined dairy operations moved into north
central Texas, many of the peanut growers who no longer had quotas (because of peanut policy
changes) began producing corn silage for the dairy operators.
Niche marketing is servicing all or part of a unique market, or a unique portion of a common
market, not already served.
Recognizing Niche Marketing Opportunities
There is often little difference between recognizing a potential business opportunity and
recognizing a niche marketing opportunity. Sometimes people find themselves in a niche market
without planning it. Perhaps there is a product or service you need, but that is difficult to obtain
in your area, so you begin providing the service for yourself. You might soon find that others are
asking you to provide it for them also. Examples are custom welding and hoof trimming. So, one
way to recognize the potential for a niche market is to think about those goods and services you
need. Perhaps others in your community come to you for advice, help or a certain kind of
service. Do you seem to be recognized as the expert at something everyone needs? Is this service
or product something you could do for a fee? Examples of niche marketing opportunities follow
in Table 1.
Table 1: Niche Market Examples.
Sector
Product
Niche
Agriculture
Timothy hay
Race horse feed
Agriculture
Kosher milk
Religious groups following dietary laws
Agriculture
Organic vegetables
Consumers wanting foods grown without pesticides
Agriculture
Extra fat beef
Asian export market
Agriculture
Corn silage
Confined dairy operations and beef feedlots
Agriculture
Custom farming
services
Other producers who do not have the resources to perform these
services
Agriculture
Pasteurized goat milk
Consumers allergic to cow milk
Consumer durables
Convertible automobile Drivers desiring a vehicle with an open top, sporty styling and
limited seating
Consumer services
Internet auction sites
Consumers desiring low prices for goods and services without
having to physically move from merchant to merchant
Consumer services
Commuter airlines
Smaller communities not served by large airliners
Consumer services
Cut your own
Christmas trees
Fellowship, recreation, and consumers seeking quality
You might also recognize a niche marketing opportunity from speakers you hear, articles you
read, or other events that grab your attention. Someone may have offered you an opportunity to
provide a product or service for a specific market. You may have heard a speaker, such as an
Extension specialist, discuss niche marketing activities. You may have seen articles in magazines
or newspapers focusing on the shortage of, or need for specific goods or services for a certain
part of the market. This type of information could trigger an idea or vision that leads to the
development of a niche marketing venture. Examples are producing high quality hay for race
horses, producing and marketing tilapia, mushrooms, and fresh organically grown vegetables.
Many people have hobbies they enjoy, or develop special skills. Sometimes these hobbies and
special skills can evolve into a niche market. An example is handmade furniture sold at craft
fairs.
Getting Started
Getting started and establishing a strong business requires certain steps:
1. Identify the specific niche market you want to serve, and all its characteristics. These
could be demographic (types and characteristics of the people in the market), geographic
area, pricing structure, costs of servicing the niche, expected obstacles, and required fees
or licenses.
2. Write down your goals for your family and your occupation. Then decide if becoming a
niche marketer is compatible with your long-term family and occupational goals.
3. Decide what resources capital, land, labor, knowledge, special skills or talents you have
for undertaking niche marketing.
4. Determine any resources you lack, and how you will make up for them.
5.
Develop a business/ marketing plan.
The Business/ Marketing Plan
A business/ marketing plan is many things. It can act as a map providing directions to help a
business achieve its goals; it is a statement to family, potential investors and others involved in
the business about your projected performance; it is a statement to your banker about your credit
worthiness.
The business and marketing plans contain the following:
•
a mission statement, objectives and strategies
•
a general description of the proposed business, including your qualifications and reasons
for starting the business
•
a market analysis is a statement describing the product or service, the estimated size of
the market in terms of volume of product or amount of service, the segment of the market
you expect to serve, and the geographic area you will serve
•
projected sales schedules and volumes
•
a description of the operational aspects such as location, facilities and materials needed,
and staffing
•
a financial plan, including projected income statements, cash flows, balance sheets, loan
repayment schedules, statements of owner equity, and breakeven analysis
•
a sensitivity or risk analysis, which estimates the financial effects of different sales/
purchase prices and quantities produced and sold
•
sources of information and help
Getting the Help You Need
To be successful, you will need advice and help to plan and establish your niche marketing
business. One of the best sources of help is people who are doing something similar. Find out
who is doing what you hope to do and learn from them. It may require you traveling outside of
your area to speak to these people if they perceive you as a direct competitor. Seek reference
material from libraries, the Internet, teachers, Extension agents and specialists, and the news
media. Visit trade shows and fairs. In short, network!
There are risks in beginning any new business venture, but with planning you can be successful.
There are many opportunities in niche marketing.
Here are sources of additional information on niche marketing.
i
•
Your county Extension agent
•
Colleges and Universities
•
Wall Street Journal
•
ATTRA - National Sustainable Agriculture Information Service
•
Kiplinger magazine
•
Forbes magazine
•
Brooks, William T. 1991. Niche Selling. McGraw-Hill.
•
Goodridge, Walt F. "Niche Market Report: Discovering, Understanding and Selling to the Niche Consumer
of the 21st Century." A Company Called W (Niche Market Exclusives), Jan. 1999.
•
Goodridge, Walt F. "Lessons in Success from the Silent Performer: Walt's Friday Inspirations, the Book."
A Company Called W (Niche Market Exclusives), Nov. 1998.
•
Brodsky, Bart and Janet Geis. Finding Your Niche. Community Resource Institute Press.
Adapted from a fact sheet produced by: Robert B. Schwart, Dean McCorkle and David Anderson, Professor and
Extension Economist, Extension Economist Risk Management, and Assistant Professor and Extension Economist,
The Texas A&M University System.